The Tuesday after Thanksgiving has become a popular donation day. The charitable boosting effort, dubbed Giving Tuesday when it was initiated in 2012, is now the unofficial kick-off of the annual end-of-year charitable season. Most people don't give to good causes because they get tax breaks. Thank goodness for that, since the 2017 tax reform bill made it more difficult to claim a charitable deduction for donations. And that brings us to the first of this post's six charitable donation tax tips. 1. Itemizing required: The only way to get a tax deduction for your donations is to claim them... Read more →
Photo by Chris Henry on Unsplash You're heading home from your Thanksgiving get-together, loaded down with leftovers and maybe something less welcome. Yeah, your indigestion has been acting up, inflamed by overly rich food and some family members who just wouldn't let things go. The good news is that you can use your flexible spending account (FSA) funds to pay for the Tums or Gaviscon or whatever over-the-counter (OTC) remedy works for you. You may remember that not too long ago, you had to jump through hoops to get FSA coverage for these store shelf treatments under an Affordable Care... Read more →
Photo by Mikkel Bergmann on Unsplash We're into the Thanksgiving weekend and still noshing on leftover turkey. (Or, in my case, pumpkin pie.) But here's a Tax Turkey you shouldn't let linger. Don't wait to look into converting, in full or partially, your traditional IRA to a Roth IRA. Individual retirement savings options: IRAs, or individual retirement arrangements (although most of us read the A as account), have long been a popular way for individuals, with or without a workplace retirement plan, to save for their post-work year. The original version, now known as a traditional IRA, debuted in 1975,... Read more →
Tom and Tillie Turkey take care of their youngsters, like these three young Bourbon Red poults. But poultry and the rest of the animal world doesn't have to send their offspring to college. (Photo by Jennifer Kleffner via Flickr CC) A recurring phrase uttered at holiday season family gatherings is "you've grown so much since I last saw you!" What that usually means for many parents of those youngsters is that they will soon be heading off to college. And that move to campus means that mom and dad will have to come up with big bucks. The best way... Read more →
Happy Thanksgiving Day! Once you retire, you might be able to spend the holiday in a different way, depending on your golden year dreams and how much money you've saved for post-work years. (Photo by sterlinglanier Lanier on Unsplash) How's your Thanksgiving morning going? It's pretty quiet at our house, since it's only the hubby and me. And aside from baking a pumpkin pie, our meal is Texas smoked brisket, sausage, and sides we picked up from a local barbecue joint yesterday afternoon. If your Turkey Day is more hectic, enjoy! When I was growing up in West Texas, my... Read more →
What better topic for Thanksgiving than tax turkeys and how to avoid them. Our first tax turkey, represented by this solo strutting showy bird, is incorrect withholding. (Photo by Chris Henry on Unsplash) Thanksgiving, a time of gathering with family you haven't seen for a while. But sometimes, even when we get along with our relatives, we need a break from all that familial reconnecting. You could take a walk. Or check out a calming app. Or take care of a tax task. To help with that third suggestion, the rest of this Thanksgiving week (and weekend) the ol' blog... Read more →
Technology is great, except when it isn't. And technology can be potentially dangerous, especially when taxes are involved. We all know that our tax data is a prime target for crooks. They can use the information on our 1040s to file fake returns and too often, despite improved Internal Revenue Service security measures, collect fraudulent refunds. They also can use the info on our tax paperwork — earnings, investments, Social Security numbers for us and our family members — to steal our identities and ruin us financially. And now we've learned that major tax software and e-filing companies have been... Read more →
Holiday season is here. So are the accompanying scams. True, con artists operate year-round. But they really ramp up their schemes during this time of giving. Some try to trick people who are stretched a bit too thin into thinking there's free money out there … as long as they supply some personal and financial information. Other scammers use the hook of holiday giving, especially for those who are less fortunate. Just send along your help to the fake emailer, they say, or even easier, just click on the link. 'Tis the phishing season: And some go for a combo... Read more →
Is your retirement plan on target? Maybe not, thanks (no thanks!) in part to the COVID pandemic and inflation. People have been, understandably, more focused of late on meeting daily living expenses than saving for the future. Such financial concerns likely are partially responsible for the results of a new retirement savings report from Fidelity. The Boston-based investment company found that the average 401(k) balance declined for the third straight quarter. It dipped below the six-figure mark, coming in at $97,200. That's 23 percent lower than a year ago. The average individual retirement arrangement (IRA) balance also dropped. The average... Read more →
My polling place only had Spanish "¡Yo Voté! / I voted" stickers. But the language doesn't matter. The act of voting, this year and in the future, does. (Photo by Kay Bell) The 2022 midterm elections have come and gone. As the old saying goes, it's all over but the shouting or crying or both. In addition to selecting individuals to lead our local, state, and federal governments, many of us were asked to decide on ballot issues. Overall, according to Ballotpedia, voters in 37 states and the District of Columbia decided Nov. 8 on 132 statewide ballot measures. Since... Read more →
Regardless of what prompts an IRS examination, aka an audit, take advantage of the Taxpayer Bill of Rights guarantee that you can get professional help to get you through the process. Photo by SHVETS Production In an expected follow-up to reports that Donald J. Trump, while in the Oval Office, wanted the Internal Revenue Service to audit his perceived foes, a House tax writing committee member is asking for an investigation into the former president. Rep. Bill Pascrell (D-New Jersey), who chairs the Ways and Means Oversight Subcommittee until the next GOP-controlled House is sworn in, wrote the Attorney General... Read more →
These senior citizens celebrate their shared birthday month, if not the required traditional IRA withdrawals the big days may trigger. A QCD can help avoid tax on the mandated distributions. (Photo by Kay Bell) Most of us still have a real life, old-school, snail mail box. Every November, it is the target for the most mail of the year. Yep, the holidays are here. My curbside box is jammed with two types of correspondence, catalogs and charity solicitations. I get a kick out of thumbing through the catalogs. And yes, I even order a few (too many) things. The donation... Read more →
David Boeke via Flickr The Internal Revenue Service got billions in added funding thanks to the Inflation Reduction Act, but money is still key. Specifically, Uncle Sam's tax agency needs "consistent and multi-year funding … to achieve its goals of providing efficient, effective, modern service to the nation's taxpayers," according to the Internal Revenue Service Advisory Council's (IRSAC) 2022 annual report. The IRSAC report lauds the Inflation Reduction Act's fiscal boost as a "once-in-a-generation opportunity to upgrade the IRS's service, enforcement, and IT capabilities." However, IRSAC members point out that the measure "was largely partisan legislation and may not foreshadow... Read more →
Updated Wednesday, Nov. 16, 2022 You still have time to electronically claim the benefits, but not much. The deadline to e-file is Thursday, Nov. 17. If you missed out on the special COVID-19 relief payments, notably the enhanced Child Tax Credit (CTC), then head to the Internal Revenue Service's Free File website. The IRS is keeping Free File operating through Nov. 17 so eligible nonfilers can e-file a Form 1040 to claim their eligible COVID benefits at, as the name says, no cost. In addition to the CTC, eligible taxpayers may be able to claim some or all of the... Read more →
Some of my grandmother's paintings, known as the main Vera Gallery in our house. (Photo by Kay Bell) The hubby and I are art fans, primarily of painted works. That's why almost all of our vacations include a visit to our destinations' museums. Our appreciation of a piece hanging on a wall is why most of our rooms are adorned by framed artworks. Most are signed limited edition print versions of our favorite painters' works. But we also have some originals of a few notable artists, as well as works that are more sentimental but just as lovely, like the... Read more →
Image by Ag Ku from Pixabay There's some good news for taxpayers and the Internal Revenue Service as we near the new year and 2023 tax filing season. The IRS is making progress in working through its backlog of paper tax returns. In a Nov. 10 update on IRS Operations During COVID-19: Mission-Critical Functions Continue webpage, the agency reports that it is "opening mail within normal time frames," and has "processed all paper and electronic individual returns" that had no errors or didn't require further review "in the order received if they were received prior to April 2022." As of... Read more →
Right now, a lot of folks are thinking they should have been like Larry. The Larry they wished they'd emulated is Larry David, known for his curmudgeonly television character. He tweaked that persona to become a naysayer on several inventions that, per the commercial's Super Bowl debut, changed the world. The television ad for FTX crypto exchange advised viewers, "Don't be like Larry" and instead invest in digital currency via the company. On Friday, Nov. 11, FTX filed for bankruptcy following reports that between $1 billion to $2 billion of FTX customer funds disappeared. Continuing crypto troubles: This is just... Read more →
Korean War Memorial on National Mall, Washington, D.C. (Photo by Brittany Colette on Unsplash) 11 a.m. on Nov. 11, 1918. That moment marked the armistice between World War I's Allied forces and Germany, ending the fighting on the Western Front. The commemoration to honor the 4.7 million Americans who served — and the 116,500 who died — in what then was called the Great War originally was celebrated as Armistice Day. In 1954, the annual Nov. 11 commemorations were rebranded Veterans Day, and the day's focus expanded to honor veterans from all eras. But the momentousness of the event 104... Read more →